Monday, February 20, 2017

How Do "Domestic Partnerships" Fare for Elderly Couples?

George Washington Law Professor Naomi Cahn recommended an interesting new article from the Elder Law Journal, "The Precarious Status of Domestic Partnerships for the Elderly  in a Post-Obergefell World."

Authors Heidi Brady, who is clerking for the Fifth Circuit Court of Appeals, and Professor Robin Fretwell Wilson from the University of Illinois College of Law, team to analyze key ways in which elderly couples in domestic partnerships may be treated differently, and sometimes more adversely, than same sex couples who are married.  From the abstract: 

Three states face a particularly thorny question post-Obergefell [v. Hodges, the Supreme Court's 2015 decision recognizing rights to marry]: what should be done with domestic partnerships made available to elderly same-sex and straight couples at a time when same-sex couples could not marry. This article examines why California, New Jersey, and Washington opened domestic partnerships to elderly couples. . . . This Article drills down on three specific obligations and benefits tied to marriage -- receipt of alimony, Social Security spousal benefits, and duties to support a partner who needs long-term care under the Medicaid program -- and shows that entering a domestic partnership rather than marrying does not benefit all elderly couples; rather, the value of avoiding marriage varies by wealth and benefit. 

Thank you, Naomi, for this recommendation.  

February 20, 2017 in Estates and Trusts, Ethical Issues, Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, Social Security, State Cases, State Statutes/Regulations | Permalink | Comments (0)

Sunday, January 22, 2017

Illinois Law Professor Kaplan on "Reforming Taxation of Retirement Income"

University of Illinois Law Professor Richard Kaplan responded to my post last week, that questioned the appropriate age to compel IRA distributions, by providing a more in-depth look at the topic, via his own article, Reforming Taxation of Retirement Income.  

His recommendations include simplifying how Social Security retirement benefits are taxed, bifurcating defined contribution plan withdrawals into capital gains and ordinary income components, repealing certain exceptions to the early distribution penalty, reducing the delayed distribution penalty and adjusting the age at which it is triggered, and changing the residential gain exclusion to avoid unanticipated problems with reverse mortgages.

The 2012 Virginia Tax Review article demonstrates that increased life expectancy supports an increase to age 74 (from 71.5) as the trigger for mandatory distributions.  

Thanks, Dick!  As always, you have important analysis to share. 

January 22, 2017 in Current Affairs, Estates and Trusts, Federal Statutes/Regulations, Retirement, Social Security, Statistics | Permalink | Comments (0)

Friday, January 20, 2017

Is Age 70.5 No Longer an Appropriate Age to Compel IRA Distributions? What Sayeth Donald Trump?

Under long-standing IRS rules, IRAs and similar retirement accounts created with tax deferred income are generally subject to "required minimum distributions" when the account holder reaches age 70 and a half.  As the IRS.gov website reminds us:

  • You can withdraw more than the minimum required amount.
  • Your withdrawals will be included in your taxable income except for any part that was taxed before (your basis) or that can be received tax-free (such as qualified distributions from designated Roth accounts).

As the Wall Street Journal recently reported, as baby boomers are now reaching that magic age of 70 1/2+, there will be huge mandatory transfers of savings, creating taxable income, even if they don't actually need the retirement funds yet.

Boomers hold roughly $10 trillion in tax-deferred savings accounts, according to an estimate by Edward Shane, a managing director at Bank of New York Mellon Corp. Over the next two decades, the number of people age 70 or older is expected to nearly double to 60 million—roughly the population of Italy.

The account holders may not actually "need" the money in their early 70s, an age now often seen as "young" for retirement, and they may still be in high tax brackets, thus cancelling the original reasons for the savings and deferral.  The rules were made when average lifespans were shorter. 

On average, men and women who turned 65 in 2015 can expect to live a further 19 and 21.5 years respectively, according to the U.S. Social Security Administration’s most recent life-expectancy estimates; those post-65 expectancies are up from 15.4 and 19 years for those who turned 65 in 1985.

....[D]istributions are expected to grow exponentially over the next two decades because of a 1986 change to federal law designed to prevent the loss of tax revenue. Congress said savers who turn 70½ have to start taking withdrawals from tax-deferred savings plans or face a penalty. Specifically, retirees who turn 70½ have until April of the following calendar year to pull roughly 3.65% from their IRA and 401(k) funds, subject to slight differences in the way the funds are treated by the Internal Revenue Service. Then they must withdraw an increasing portion of their assets every year based on IRS formulas. The rules don’t apply to defined-benefit pensions, where retirees get automatic distributions.

There is a 50% penalty for failure to make required minimum withdrawals.  And not all retirees are aware of the consequences of failing to make with withdrawals, especially when accounts were created originally by a spouse who is no longer alive or is unable to manage the account personally. From the Wall Street Journal article:

Bronwyn Shone, a financial adviser in Pleasanton, Calif., said many of her clients aren’t aware of their legal obligation to take distributions. “I think some people thought they could let the money grow tax-deferred forever,” she said.

Certainly the federal government wants -- and an argument can certainly be made that it "needs" -- more tax revenues, but if the goal of the permitted deferral is to encourage saving for the the "real" needs of retirement, which can include disability, health care, long-term care, and other "late in aging" needs, is it still realistic to set the mandatory threshold for withdrawals at age 70.5?  For example, Donald Trump is just today commencing his "new job" at age 70 and a half, and yet he could be subject to the RMDs for any IRAs. Maybe this is a financial issue that might interest the new Trump Administration? 

For more, read Pulling Retirement Cash, but Not by Choice, by WSJ reporters V. Monga and S. Krouse (paywall protected article from 1/16/17).

January 20, 2017 in Current Affairs, Estates and Trusts, Ethical Issues, Federal Statutes/Regulations, Health Care/Long Term Care, Retirement, Social Security | Permalink | Comments (0)

Tuesday, January 17, 2017

UCLA Prof. Allison Hoffman on "Reimagining the Risk of Long-Term Care"

With the new Presidential administration ahead, many of us are asking what government policies or programs will be "re-imagined."  With changes on the horizon, an especially interesting perspective on long-term care is offered by UCLA Law Professor Allison Hoffman with her recent article, "Reimagining the Risk of Long-Term Care,"  published in the Yale Journal of Health Policy, Law & Ethics. From the abstract:

While attempting to mitigate care-recipient risk, in fact, the law has steadily expanded next-friend risk, by reinforcing a structure of long-term care that relies heavily on informal caregiving. Millions of informal caregivers face financial and nonmonetary harms that deeply threaten their own long-term security. These harms are disproportionately experienced by people who are already vulnerable--women, minorities, and the poor. Scholars and policymakers have catalogued and critiqued these costs but treat them as an unfortunate byproduct of an inevitable system of informal care.
 
 
This Article argues that if we, instead, understand becoming responsible for the care of another as a social risk--just as we see the chance that a person will need long-term care as a risk--it could fundamentally shift the way we approach long-term care policy.
 
Professor Hoffman examines various ways in which society expects third parties, including but not limited to family members as "next friends," to provide unpaid assistance and/or out-of-pocket dollars to disabled adults or seniors needing help.  She writes, for example, about filial support laws used sporadically to compel certain family members to finance care.  She observes that often, without direct personal experience, society members are unaware of the real costs of long-term care, both financially and emotionally, writing: 
 
As one informal caregiver and scholar described: “I feel abandoned by a health care system that commits resources and rewards to rescuing the injured and the ill but then consigns such patients and their families to the black hole of chronic ‘custodial’ care.” What next friends do for others is herculean, both in terms of the time spent and the ways that they offer assistance.
 
Recommended reading for the new year.  

January 17, 2017 in Current Affairs, Dementia/Alzheimer’s, Ethical Issues, Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, Social Security, State Statutes/Regulations, Statistics | Permalink | Comments (0)

Monday, January 9, 2017

Social Security Full Retirement Age in 2017

Social Security's blog, Social Security Matters, posted the full retirement age info for 2017. 2017 Brings New Changes to Full Retirement Age explains that for those between 1955-1956, full retirement age is 66 and 2 months.  The post also explains what the increase in full retirement age means to benefits: "[a]s the full retirement age continues to increase, there are greater reductions in benefits if you claim them before you reach full retirement age.  For example, if you apply for benefits in 2017 at age 62, your monthly benefit amount will be reduced nearly 26 percent." The blog also offers tips to those who are contemplating retirement along with helpful links.

January 9, 2017 in Consumer Information, Current Affairs, Federal Statutes/Regulations, Retirement, Social Security | Permalink | Comments (0)

Wednesday, December 28, 2016

Student Loans and Social Security

Imagine a person who has at last retired, is drawing Social Security and still has outstanding student loans. Farfetched? Not at all. And, in fact, the GAO issued a report noting how Social Security checks are being reduced to repay these student loans. The Wall Street Journal explains about the report in the article, Social Security Checks Are Being Reduced for Unpaid Student Debt:

The report highlights the sharp growth in baby boomers entering retirement with student debt, most of it borrowed years ago to cover their own educations but some used to pay for their children’s schooling. Overall, about seven million Americans age 50 and older owed about $205 billion in federal student debt last year. About 1 in 3 were in default, raising the likelihood that garnishments will increase as more boomers retire.

Student loan debt isn't dischargeable in bankruptcy, but the effect of the government's actions is to leave some Social Security recipients below the poverty level.  "[C]onsumer advocates and some congressional Democrats say the government’s tactics have become too aggressive, targeting many borrowers who are destitute and have no hope of repaying. Most Social Security recipients rely on their checks as their primary source of income, other research shows."

The GAO report, Social Security Offsets: Improvements to Program Design Could Better Assist Older Student Loan Borrowers with Obtaining Permitted Relief offers the following findings

 Older borrowers (age 50 and older) who default on federal student loans and must repay that debt with a portion of their Social Security benefits often have held their loans for decades and had about 15 percent of their benefit payment withheld. This withholding is called an offset. GAO’s analysis of characteristics of student loan debt using data from the Departments of Education (Education), Treasury, and the Social Security Administration (SSA) from fiscal years 2001-2015 showed that for older borrowers subject to offset for the first time, about 43 percent had held their student loans for 20 years or more. In addition, three-quarters of these older borrowers had taken loans only for their own education, and most owed less than $10,000 at the time of their initial offset. Older borrowers had a typical monthly offset that was slightly more than $140, and almost half of them were subject to the maximum possible reduction, equivalent to 15 percent of their Social Security benefit. In fiscal year 2015, more than half of the almost 114,000 older borrowers who had such offsets were receiving Social Security disability benefits rather than Social Security retirement income.

In fiscal year 2015, Education collected about $4.5 billion on defaulted student loan debt, of which about $171 million—less than 10 percent—was collected through Social Security offsets. More than one-third of older borrowers remained in default 5 years after becoming subject to offset, and some saw their loan balances increase over time despite offsets. However, nearly one-third of older borrowers were able to pay off their loans or cancel their debt by obtaining relief through a process known as a total and permanent disability (TPD) discharge, which is available to borrowers with a disability that is not expected to improve.

GAO identified a number of effects on older borrowers resulting from the design of the offset program and associated options for relief from offset. First, older borrowers subject to offsets increasingly receive benefits below the federal poverty guideline. Specifically, many older borrowers subject to offset have their Social Security benefits reduced below the federal poverty guideline because the threshold to protect benefits—implemented by regulation in 1998—is not adjusted for costs of living (see figure below). In addition, borrowers who have a total and permanent disability may be eligible for a TPD discharge, but they must comply with annual documentation requirements that are not clearly and prominently stated. If annual documentation to verify income is not submitted, a loan initially approved for a TPD discharge can be reinstated and offsets resume.

A pdf of the 90 page report is available here. An accompanying podcast is available here.

December 28, 2016 in Consumer Information, Current Affairs, Federal Statutes/Regulations, Social Security | Permalink | Comments (0)

Tuesday, December 20, 2016

Rep Payee Interdisciplinary Training

Social Security has released a video series for Rep Payees that is an interdisciplinary training "to educate individuals and organizations about the roles and responsibilities of serving as a representative payee, elder abuse and financial exploitation, effective ways to monitor and safely conduct business with the banking community, and ways to recognize the changes in decisional capacity among vulnerable adults and seniors."  There are 5 videos (1 of which is a short introduction) with the 4 training videos running in length from 15-35 minutes, depending on the topic. The topics include technical training as a rep payeerecognizing financial exploitation and vulnerable adult abuse, strategies for dealing with the financial community and changes in a beneficiary's decisional capacity. A transcript is available in addition to the video.

 

December 20, 2016 in Consumer Information, Current Affairs, Federal Statutes/Regulations, Social Security | Permalink | Comments (0)

Sunday, November 13, 2016

What Will President Trump Administration Mean for Seniors?

As I've spent several recent weeks of my sabbatical in Arizona to be closer to my 90+ year old parents, I watched the run up to the election from this Southwestern vantage point, instead of my usual Pennsylvania location.  Not only was I surprised by the result of the Pennsylvania vote, it was a surprise to see Arizona voters -- usually a Republican stronghold with a strong "senior" vote-- struggle with the election choices available to them.  

On November 8, Arizona rejected legalization of recreational marijuana (predictable) and approved a significant increase of minimum wage (a closer call, as the business community in Arizona largely opposed that increase).  Further, Trump had angered some by throwing shade on 80-year-old Senator John McCain's "hero" reputation. In contrast, Trump's seeming alliance with controversial Sheriff Joe Arpaio, despite the later's pending criminal contempt prosecution, gave other Arizonans pause. Ultimately, 84-year-old Arpaio was voted "out" in Arizona (but, it remains to be seen whether he will be "out" of government at the federal level too).   In other words, Arizonans were not voting in support of a "pure" Republican platform.  

My mom, a Democrat but a somewhat reluctant Hillary supporter, was glued to CNN for much of the summer and fall, and she accurately predicted the Trump victory despite the pollsters' and commentators' refusal to acknowledge the frustrations driving the Trump tidal.  She insisted on voting on election day, rather than taking advantage of Arizona's early vote options. 

We know little about how Donald Trump will prioritize and govern once he takes the reins of his very first elected position.  That uncertainty makes many nervous even as it makes others hopeful.  

What will a Trump Administration mean for aging Americans?  Some topics to consider:

  • Public Retirement Benefits:  Candidate Trump -- rarely one to get into the details of policy issues -- seemed o make a distinction between age-based benefits, including Social Security retirement and Medicare health insurance coverage, and disability-based benefits.  Congress may seize on the latter.  Trump argued "more jobs, less waste" was a cure for the solvency questions.   On the one hand, he says he would support privatizing "some portion" of Social Security savings or investments to allow individuals to self-invest, while on the other hand rejecting "government" in the role of the retirement"investor." He seems willing to consider means testing for payment of retirement benefits. Here's a link to several utterances of Donald Trump on the topic of Social Security.  
  • Health Care for Seniors:  Unlike ObamaCare in general, it will probably be harder for Donald Trump and Congress to displace the fundamentals of Medicare for seniors.  But real cost questions attend health care for seniors.  At what point will Trump be hit with the reality that all of his campaign plans about immigration, walls, foreign trade and infrastructure pale in comparison to the true challenges facing an aging American on health care?  
  • Medicaid for Long-Term Care:  Candidate Trump has probably not focused on Medicaid as a source of long-term care financing.  With Republicans controlling the House and Senate, however, will the old "anti-Medicaid planning" forces feel newly energized?
  • Consumer Protections for Older Americans:  Candidate Trump will feel the pressure from Republican-controlled Congress to roll back administrative safeguards implemented by President Obama during the last two years. Perhaps here is where seniors may feel the quickest impact from the change in power, including potential rollbacks on consumer protection measures that attempted to bar pre-dispute binding arbitration "agreements" for nursing home residents, implemented fiduciary duty standards for investment advisors, and imposed closer scrutiny on consumer credit companies. Indeed, the most direct threat of the Trump Administration, combined with the Republican Congress, is likely to be to "Elizabeth Warren's Consumer Financial Protection Bureau."  

How this all plays out will be "interesting," won't it?  The points above are about today's generation of seniors.  Perhaps the most important Trump impact will be for "future" seniors, especially if Trump's predicted roll back on environmental protections and his advisors' seeming rejection of climate science hold sway.  

November 13, 2016 in Consumer Information, Current Affairs, Ethical Issues, Health Care/Long Term Care, Medicaid, Medicare, Social Security | Permalink | Comments (1)

Wednesday, November 9, 2016

A Two-Question Quiz on The Timing For Your Retirement

The Wall Street Journal ran an article last month about a study that focused on people's decision-making regarding whether to retire.  Before Retiring, Take This Simple Test reports on study by "Philipp Schreiber and Martin Weber at the University of Mannheim in Germany, [where]  a simple two-question quiz [was developed] that can help predict whether you’ll regret the timing of your own retirement."  Two questions-that's pretty easy, right. Here we go, it won't take you long to answer them:

Question 1: You just learned that you are due a tax refund. If you’d like, you can get the $1,000 refund right away. Alternatively, you can get a $1,100 refund in 10 months. Which do you prefer?

Question 2: You just learned that you are due a tax refund. If you’d like, you can get a $1,000 refund in 18 months. Alternatively, you can get a $1,100 refund in 28 months? Which do you prefer?

How did you answer them? According to the article, "[t]he point of the exercise is to measure the consistency of a person’s time preferences. Someone with consistent time preferences should answer both questions the same way—choosing the early option both times, or the delayed option both times. Such consistency is a requirement for making financial plans that you stick with."  There are folks who don't answer consistently, and that's a red flag, the article explains. Those folks  "exhibit a tendency known as present bias, or hyperbolic discounting. They strongly prefer rewards that arrive right away." As for timing of retirement, the article notes that study shows that those who provided inconsistent answers ultimately regret the timing (too early) of their retirement.

The article suggests some positive applications of the study results. For those of us who participate in savings via payroll deductions, such programs could be improved "if they were personalized according to the results of the two-question quiz. Consider a person who exhibits a strong bias for receiving rewards in the present. Given the likelihood that she’ll be tempted by an early retirement, she might want to be defaulted to a higher savings rate during her working years. This will help her avoid future regret over the timing of her retirement decision, since she will have sufficient savings."  The article goes further, suggesting changes to enrollment in Social Security to minimize buyer's remorse for early retirement (evidently a lot of folks start drawing Social Security at age 62, which we all know results in a permanent reduction in benefits).

The study referenced in the WSJ article is reported in The Influence of Time Preferences on Retirement Timing. The abstract explains

This study analyzes the empirical relation between the decision when to retire and individuals time preferences. Theoretical models predict that hyperbolic discounting leads to dynamic inconsistent retirement timing. Conducting an online survey with more than 3,000 participants, we confirm this prediction. The analysis shows, that time inconsistent participants decrease their planned retirement age with increasing age. The temptation of early retirement seems to become stronger the closer retirement comes. We show that the negative effect of age is between 1.5 and 3 times stronger for participants who can be classified as hyperbolic discounters. In addition, we find that time inconsistent participants actually retire earlier. On average, the most time inconsistent participants retire about 2.2 years earlier. The time inconsistent behavior has severe consequences: Time inconsistent participants are ex post more likely to regret their retirement timing decision. Also, the unplanned early retirement leads to a constant decrease of retirement benefits of about 13%.

The full paper can be downloaded from the SSRN link here.

 

November 9, 2016 in Consumer Information, Current Affairs, Retirement, Social Security | Permalink | Comments (0)

Sunday, November 6, 2016

Too Poor to Retire

Our local newspaper, the Tampa Bay Times, recently ran a story about elders who work at low-paying jobs. Although they may wish to retire, they find themselves unable to afford retirement.  For some low-income workers, retirement is only a dream explains that for low-wage workers can't afford to retire. "Studies have found that about one-third of low-wage workers ... say they'll never be able to afford retirement. The problem is particularly acute among minority women... mA 2016 study by the Associated Press-NORC Center for Public Affairs Research found that a quarter of workers 50 or older say they won't retire. Among low-wage workers, earning less than $50,000 a year, it was 33 percent."

Consider the following statistics:

A 2016 report by the nonpartisan research nonprofit National Institute on Retirement Security shows that many black, Hispanic and Asian women have to work past retirement age to be able to afford basic expenses. Women were 80 percent more likely than men to be impoverished.

The research showed that for men ages 70 to 74, about 19 percent of their income comes from wages. For women, it's about 15 percent.

Some low-wage workers will be able to collect Social Security, which will be of some help, but as the story notes, some without legal status won't be able to draw Social Security.  One of the individuals featured in the story is 70 years old and works 6 days a week as the caregiver a 100 year-old person.

So what happens if the low-wage worker falls ill and is unable to continue to work?  Might family step in to help? Are there options?

November 6, 2016 in Consumer Information, Current Affairs, Health Care/Long Term Care, Retirement, Social Security | Permalink | Comments (1)

Monday, October 31, 2016

2017 COLA & Inflation: Not Keeping Up

SSA announced recently that there would be a COLA for 2017, but it is a teensy COLA, actually, a .03% increase. Big gap between Social Security cost-of-living adjustment and retiree inflation offers a critical look at the 2017 COLA compared to inflation and how the government calculates the COLA using the consumer price index. An article in USA Today about the 2017 COLA noted that this COLA won't allow beneficiaries to get ahead, even slightly. Instead, they will likely lose ground, because of the Medicare Part B premium costs

The nation’s 65 million Social Security beneficiaries will receive a paltry 0.3% cost-of-living adjustment to their monthly checks in 2017, the government announced Tuesday. In dollars and cents, it means the average retired beneficiary’s check will rise about $5 to $1,360 per month in 2017.

The even more bitter pill: Many current Medicare beneficiaries won’t be able to spend any of that extra money. Instead, they’ll likely have to send their COLA straight back to Uncle Sam to cover higher Medicare Part B premiums.

Almost a third of Medicare's 56 million beneficiaries could see their premiums jump 22% next year, according to the Medicare Trustees Report, putting the cost at an estimated $149 per month. Those unlucky 30% of beneficiaries include people enrolling in Part B for the first time in 2017, people who are on Medicare but who aren't currently taking Social Security benefits and current enrollees who pay an income-related higher premium.

October 31, 2016 in Consumer Information, Current Affairs, Federal Statutes/Regulations, Health Care/Long Term Care, Medicare, Retirement, Social Security | Permalink | Comments (1)

Friday, October 21, 2016

LeadingAge's Annual Meeting Begins October 30 in Indianapolis

LeadingAge, the trade association that represents nonprofit providers of senior services, begins its annual meeting at the end of October.  This year's theme is "Be the Difference," a call for changing the conversation about aging.  I won't be able to attend this year and I'm sorry that is true, as I am always impressed with the line-up of topics and the window the conference provides for academics into industry perspectives on common concerns.  For example, this year's line up of workshops and topics includes:

October 21, 2016 in Advance Directives/End-of-Life, Consumer Information, Current Affairs, Dementia/Alzheimer’s, Discrimination, Elder Abuse/Guardianship/Conservatorship, Ethical Issues, Federal Statutes/Regulations, Health Care/Long Term Care, Housing, International, Legal Practice/Practice Management, Medicaid, Medicare, Programs/CLEs, Property Management, Retirement, Science, Social Security, State Cases, State Statutes/Regulations, Veterans | Permalink | Comments (2)

Friday, September 30, 2016

Filial Friday: PA Trial Court Rules that New Jersey's Law Controls Outcome of "Reverse" Filial Support Claim

I've been following for some time an interesting "reverse filial support law" case in Delaware County, Pennsylvania.  A key issue in Melmark v. Shutt is whether New Jersey parents of a New Jersey, disabled, indigent adult son are liable for his costs of his care at a private, nonprofit residential facility specializing in autism services, Melmark Inc., in Pennsylvania. Since most of the modern filial support claims I see involve facilities (usually "nursing homes") suing children over the costs of their elderly parents' care, I describe cases where the facility is suing parents of an adult child as a "reverse filial support" law claim.

In a September 2016 opinion that followed a June nonjury trial, the Pennsylvania trial court used a "choice of law" analysis to determine which state's substantive "filial support"  law controlled the parents' liability. The court ultimately ruled that New Jersey's statutes applied.  N.J. filial support obligations are more limited than those affecting families under Pennsylvania law.  Under N.J. Stat. Ann. Section 44:1-140(c), the state exempts parents over the age of 55 from support obligations for their adult children (and vice versa). By contrast, Pennsylvania does not place age limits on filial support, either for adult children or elderly parents.  See Pa.C.S.A. Section 4603. In the Melmark case, the father was 70 and the mother was 68 years old during the year in question.  The disabled son was 29.

The court decided that New Jersey had the "most significant contacts or relationships" to the dispute. That's classic conflict-of-laws analytical language.  At issue was more than $205,000, for costs of residential services between April 1 2012 and May 14, 2013.

Continue reading

September 30, 2016 in Ethical Issues, Health Care/Long Term Care, Medicaid, Social Security, State Cases, State Statutes/Regulations | Permalink | Comments (0)

Monday, September 26, 2016

Retirement Planning for Women

The Wall Street Journal ran an article about retirement planning for women.  The article, Retirement planning for women, offers some specific tips for women in their planning.  Are there a lot of challenges?  Perhaps the biggest one? Getting started.  "If you’re a woman, the bad news is that you face some specific challenges that men don’t. The good news? Women tend to invest and save in a way that bodes well for their retirement success."  Here is a look at their tips: start saving, invest savings, consider carefully before drawing Social Security, and complete an estate plan which includes "[a] financial power of attorney ... [a] health-care power of attorney, for health-care decisions, [a] living will for your end-of-life wishes, [and a] will naming a guardian for minor children." The article also offers a quick quiz on tips for women in retirement planning. Check it out.

September 26, 2016 in Consumer Information, Current Affairs, Retirement, Social Security | Permalink | Comments (0)

Thursday, August 25, 2016

Washington Post: Legal Counsel for the Elderly Is Part of One Woman's Story

The Washington Post has a fascinating piece about Wanda Witter's decades-long battle with the Social Security Administration. At the age of 80, Wanda's story appears to be one of success, after many years of living in shelters and on the streets of D.C..  

At the shelters all those years, Witter tried to get someone to listen to her. She explained at different offices providing homeless services that those suitcases contained the evidence. She was owed money, lots of money, and she could prove it.

 

Witter is not a particularly warm or outgoing person. She isn’t rude, just direct. And suspicious of just about everyone. And obsessed with Social Security.

 

“They kept sending me to mental counselors. I wasn’t crazy. I wasn’t mentally ill,” she said.

With the help of the Washington Legal Clinic for the Homeless, Legal Counsel for the Elderly (LCE) and a dedicated, patient and persistent social worker, Julie Turner, it appears that Ms. Witter is now in her own apartment and will receive some $100,000 in back Social Security payments.  

For the full story, read "'I Wasn't Crazy.' A Homeless Woman's Long War to Prove the Feds Owe Her $100,000."  

August 25, 2016 in Ethical Issues, Federal Statutes/Regulations, Housing, Legal Practice/Practice Management, Social Security | Permalink | Comments (0)

Tuesday, August 23, 2016

A Cellphone Required for Social Security Online Access and Then Not

This is a story of now you need it, now you don't. Social Security recently required that a person have a cellphone to use the online benefits services.  The New York Times ran an article about this requirement that went into effect at the end of July, 2016. Social Security Now Requires Cellphone to Use Online Services explains that SSA makes it mandatory to have an access code sent by text to the recipient's cellphone.  The article notes that this requirement "may create hurdles, however, especially for older Americans, who are less likely to use mobile phones. About 78 percent of people 65 and older own a cellphone, compared with 98 percent of 18- to 29-year-olds, according to 2015 data from the Pew Research Center." Still almost 80% of elders have a cell phone-a good number, but that doesn't mean that those with cellphones use text features.  The article features a variety of complaints, including the lack of advance notice.  The article includes some FAQs, as well as a link to a website on where to get help (at least it's a website, not a cellphone #).

Now for the now you don't part of this story. Recall the quote in the prior paragraph "may create hurdles"....  So within two weeks of the regulation taking effect, Social Security has stopped it, for now.  The New York Times ran a follow up story explaining the suspension:

After an outcry from older Americans, as well as a letter from two United States senators, the agency backed off the cellphone-based code requirement.

“Our aggressive implementation inconvenienced or restricted access to some of our account holders,” said a statement emailed by an agency spokesman, Mark Hinkle. “We are listening to the public’s concerns and are responding by temporarily rolling back this mandate.”

Note the use of the word "temporarily" because Social Security is continuing to increase security to protect beneficiaries' information and will "introduce alternative authentication options, in addition to texting, within the next six months."  The FAQ for this article notes that beneficiaries can opt-in to text-verification now, it's just not a requirement.

August 23, 2016 in Consumer Information, Current Affairs, Social Security, Web/Tech | Permalink | Comments (0)

Friday, August 19, 2016

You're Dead When SSA Says You're Dead---Even if You Are Not!

We have all heard stories about SSA determining that a beneficiary is dead, when the beneficiary isn’t. Proving you are very much alive has to be a fun experience (just joking in case anyone from SSA is reading this blog). Usually the stories about someone being “SSA-dead” is limited to a person. The Washington Post recently ran a story about a group of beneficiaries being declared dead by SSA. Dead or alive? Social Security misclassified some explains “Social Security officials have discovered 90 cases in their records where the living were listed as deceased.  That’s 90 “as of today,” Mark Hinkle, an SSA spokesman, said late Thursday. “We are not yet sure how many were in error.” The 90 are from a group of 19,000 cases.” Note that means more of the 19,000 may be “SSA-dead”.

There is some humor in all of this (the 90 of you declared SSA-dead, my sympathies (no pun intended folks--sympathies for the hassle) and really I’m not making light of your situation). “Ironically, the erroneous cases are from pilot projects in Virginia, North Dakota and South Dakota, designed “to enhance the quality of our death records,” Hinkle said. … Clearly, there is more work to be done on that point.”

Clearly this is no laughing matter if you are one of those declared dead-there are significant financial implications, including a loss of benefits. Plus other federal agencies get death info from SSA, so the impact is more widespread than just SSA. SSA is on it, and as for those other folks who may be SSA-dead and not know it, “SSA plans to send letters to the 19,000 people potentially affected with information on how to find out if the agency thinks they are dead and how to correct the record if that’s the case.”

I’m just saying, if you live in VA., ND or SD and get a letter from SSA in your mailbox, you may want to sit down before you open it…

August 19, 2016 in Consumer Information, Current Affairs, Federal Statutes/Regulations, Retirement, Social Security | Permalink | Comments (0)

Tuesday, July 5, 2016

Special and Supplemental Needs Trust To Be Highlighted At July 21-22 Elder Law Institute in Pennsylvania

In Pennsylvania each summer, one of the "must attend" events for elder law attorneys is the annual 2-day Elder Law Institute sponsored by the Pennsylvania Bar Institute.  This year the program, in its 19th year, will take place on July 21-22.  It's as much a brainstorming and strategic-thinking opportunity as it is a continuing legal education event.  Every year a guest speaker highlights a "hot topic," and this year that speaker is Howard Krooks, CELA, CAP from Boca Raton, Florida.  He will offer four sessions exploring Special Needs Trusts (SNTs), including an overview, drafting tips, funding rules and administration, including distributions and terminations.

Two of the most popular parts of the Institute occur at the beginning and the end, with Elder Law gurus Mariel Hazen and Rob Clofine kicking it off with their "Year in Review," covering the latest in cases, rule changes and pending developments on both a federal and state level.  The solid informational bookend that closes the Institute is a candid Q & A session with officials from the Department of Human Services on how they look at legal issues affected by state Medicaid rules -- and this year that session is aptly titled "Dancing with the DHS Stars." 

I admit I have missed this program -- but only twice -- and last year I felt the absence keenly, as I never quite felt "caught up" on the latest issues.   So I'll be there, taking notes and even hosting a couple of sessions myself, one on the latest trends in senior housing including CCRCs, and a fun one with Dennis Pappas (and star "actor" Stan Vasiliadis) on ethics questions.

Here is a link to pricing and registration information.  Just two weeks away!

 

July 5, 2016 in Current Affairs, Dementia/Alzheimer’s, Elder Abuse/Guardianship/Conservatorship, Estates and Trusts, Ethical Issues, Federal Statutes/Regulations, Health Care/Long Term Care, Housing, Legal Practice/Practice Management, Medicaid, Medicare, Programs/CLEs, Property Management, Social Security, State Cases, State Statutes/Regulations, Veterans | Permalink | Comments (0)

Wednesday, June 22, 2016

Social Security & Medicare Trustees 2016 Reports Released

It's that time of the year! The Social Security Trustees and the Medicare Trustees released their 2016 reports.  There is always a lot of information in these reports, but what everyone wants to know is when these programs are "running out" of money. According to the Social Security Trustees 2016 report, the SSDI and Retirement funds (combined) are "good" through 2034, although individually the SSDI fund isn't as robust, with its solvency at risk in 2023. 

Here is an excerpt from the summary:

The Bipartisan Budget Act of 2015 was projected to postpone the depletion of Social Security Disability Insurance (DI) Trust Fund by six years, to 2022 from 2016, largely by temporarily reallocating a portion of the payroll tax rate from the Old Age and Survivors Insurance (OASI) Trust Fund to the DI Trust Fund. The effect of updated programmatic, demographic and economic data extends the DI Trust Fund reserve depletion date by an additional year, to the third quarter of 2023, in this year's report. While legislation is needed to address all of Social Security's financial imbalances, the need remains most pressing with respect to the program's disability insurance component.

The OASI and DI trust funds are by law separate entities. However, to summarize overall Social Security finances, the Trustees have traditionally emphasized the financial status of the hypothetical combined trust funds for OASI and DI. The combined funds satisfy the Trustees' test of short-range (ten-year) close actuarial balance. The Trustees project that the combined fund asset reserves at the beginning of each year will exceed that year's projected cost through 2028. However, the funds fail the test of long-range close actuarial balance.

The Trustees project that the combined trust funds will be depleted in 2034, the same year projected in last year's report....

As far as Medicare, the Trustees report solvency through 2028. Here are two excerpts from the Trustees Report (in Section II.A.)

Short-Range Results

The estimated depletion date for the HI trust fund is 2028, 2 years earlier than in last year’s report. As in past years, the Trustees have determined that the fund is not adequately financed over the next 10 years. HI tax income and expenditures are projected to be lower than last year’s estimates, mostly due to lower CPI assumptions. The impact on expenditures is mitigated by lower productivity increases.

Looking at the separate programs Part A (HI) and Part B (SMI) the picture for SMI is a bit better

The SMI trust fund is adequately financed over the next 10 years and beyond because premium income and general revenue income for Parts B and D are reset each year to cover expected costs and ensure a reserve for Part B contingencies. A hold-harmless provision restricts Part B premium increases for most beneficiaries in 2016; however, the Bipartisan Budget Act of 2015 requires a transfer of funds from the general fund to cover the premium income that is lost in 2016 as a result of the provision. In 2017 there may be a substantial increase in the Part B premium rate for some beneficiaries. (See sections II.F and III.C for further details.) ...

 

June 22, 2016 in Consumer Information, Current Affairs, Federal Statutes/Regulations, Health Care/Long Term Care, Medicare, Retirement, Social Security | Permalink | Comments (1)

Tuesday, June 14, 2016

Improving the Rep Payee Program

Justice in Aging's June, 2016 issue brief focuses on needed improvements to Social Security's Representative Payee program. How SSA Can Improve the Representative Payee Program to Protect Vulnerable Seniors explains the rep payee program, details steps SSA has taken to improve the program and makes recommendations generally as well as to specific parts of the rep payee program.  General recommendations to improve the program overall include 

Prepare for the increased need for representative payees by developing methods to recruit and retain eligible representative payees.

Provide more in-depth training, support, and resources for representative payees and field office personnel.

Promote the use of the supported decision making model to ensure that the capability determination process and resulting appointments promote autonomy and financial independence for as long as possible.

Ensure that third party monitoring and oversight of representative payees includes the appropriate level of oversight and protects older adults from financial abuse.

Specific portions of the program that are studied include the capability determination process, monitoring and oversight,  actions against a misbehaving rep payee, monitoring of direct deposits, training rep payees and identifying those beneficiaries who need rep payees. The report concludes "[g]iven the history of misuse and lack of oversight within the program, SSA must make necessary reforms to prevent repetition of the often dehumanizing instances of fraud and misuse of funds."

 

 

 

June 14, 2016 in Consumer Information, Current Affairs, Federal Statutes/Regulations, Social Security | Permalink | Comments (0)